On Friday, the Treasury Division up to date the way it classifies autos that qualify for its $7,500 tax credit score as a part of the Inflation Discount Act (IRA). The change ought to permit extra autos, together with the Mannequin Y, to qualify for the credit score as a result of it now not locations sure crossover SUVs in the identical class as sedans.
Beforehand, some fashions of the Mannequin Y, together with the Cadillac Lyriq, had been ineligible for the electrical car tax credit score as a result of their sticker costs exceeded the utmost steered retail value of $55,000 for the sedan.
However now that the federal government makes use of the Environmental Safety Company’s (EPA) gasoline economic system labeling commonplace as an alternative of the EPA’s company common gasoline economic system (CAFE) commonplace to categorise autos, the Mannequin Y and Cadillac Lyriq now fall underneath SUV class. This offers Tesla extra leeway in terms of pricing, as autos on this class may be priced as much as $80,000 to qualify for the tax credit score.
Nonetheless, it is unclear how the Treasury Division’s listing of certified autos will change in March. That is when the company is predicted to launch its steerage on methods to apply the IRA’s strict guidelines on the sourcing and manufacturing of minerals and battery parts utilized in electrical autos.